Q. Write a short note on Contract of Agency. Also, briefly describe the principles which deals with such contracts.

  

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Answer

Delegation of powers and authorities to another person, whereby that person acts on the behalf of the authorizer, merely in independent manner, these types of relations can be called agency. It can be express or implied. The relationship of agency contains 3 parties:

I.                    Principle: who delegates the authority, or person for whom such act is done, or who is so represented (sec 182 of ICA),

II.                  Agent: to whom authority is delegated, or who is appointed to represent the principle on his behalf (sec 182),

III.               Any third party, with whom 1^st party intendent to establish contractual relationship.

Example: ‘A’ appoints ‘B’ to purchase some property from ‘C’, on his behalf. Here, ‘A’ is principal, ‘B’ is Agent and ‘C’ is the third party. The relationship of these parties combinedly called Agency.

 

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Principles on which contract of Agency is based

The law of agency is based on 2 principles:

1.                   Whatever a person can do himself, he can do the same act through his agent also, except the acts which are of personal nature.

Example: principal cannot ask his agent to marry on his behalf.

2.                   He who does through another, does by himself. This rule is based on a Latin maxim, “qui facit per alium, facit per se”.

Example: If A is authorizing B to purchase some property, the law will presume that A will be doing that act through his agent, and can be held liable for all the consequences, if arises.

 

 

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